711.652/139: Telegram
The Ambassador in Italy (Phillips) to the Secretary of State
[Received December 15—8:35 a.m.]
517. Department’s 192, December 14, 1 p.m. Italian authorities state that insofar as the “representative period” is concerned the year 1934 was only specified in their comment as an indication of a year which was not affected by special conditions and do not propose any definite years for all products.
With respect to paragraph 5 of the Précis of interpretation the explanation contained in the Department’s telegram under reference is acceptable to the Italian Government on the understanding that a discrepancy of less than 3 per cent in the rates of dollar exchange as compared with the rate of exchange of compensation currencies would not be considered as prejudicial to American commerce.
The first part of the Italian memorandum of comment regarding article 8 reads as follows:
“With reference to the memorandum presented by the United States of America concerning the interpretation to be given to certain parts of the said article, paragraph (a) the interpretation of paragraph 3 is accepted. Insofar as Italy is concerned the ‘representative’ period will be the year 1934.
(b) Paragraph 4 sub-paragraph (a) is accepted.
[Page 493](c) The wording of the first sentence of the interpretation of paragraph 4 (b) is accepted. The official Italian quotation of the dollar is in fact entirely on par with the unrestricted Italian lira quotation in New York and corresponds thereto save for negligible variations in lira quotations on the various leading world markets.”
The remainder is as quoted in my 509 of December 10th.
Definite assurances have been given to the Embassy that the treaty between Italy and Austria accords only the conditions set forth in lists A and B. The other amendments contained in the Department’s telegram with respect to the temporary arrangement are accepted by the Italian authorities. Under the circumstances the Italian authorities request that authorization to sign the temporary arrangement be transmitted to the Embassy immediately.
Should the signature be deferred beyond today the Italian Government is prepared if the arrangement can be concluded within the next 2 days to consider it effective as of December 15th.